On June 27, 2017, the EPA and the U.S. Army Corps took the first step to rescind and replace the embattled Clean Water Rule, also called "Waters of the United States" or WOTUS. The agencies formally submitted a proposed rule to rescind the 2015 WOTUS rule and recodify (on an interim basis) the same regulatory text that existed prior to the 2015 rule. The proposed rule will be published in the Federal Register in about a month.
Continue reading here.
Last week, the Iowa Bar held its Annual Meeting. The meeting allows attorneys from around the state to gather in Des Moines, connect with colleagues, and attend some great educational sessions. The Agricultural Law Section of the Bar always provides its own track of programming focused on issues important to rural clients. It's wonderful to meet with this group and to see the expertise and concern these attorneys bring to their work. To review materials accompanying our ag law year in review presentation, click here.
It's hard to believe, but registration is now open for our September Seminars and Federal Income Tax Schools!
On Thursday, September 21, we will hold our annual Agricultural Law Seminar, cosponsored by the Agricultural Section of the Iowa State Bar Association and Iowa Farm Bureau. This seminar will address key issues clients face during uncertain financial times, as well as other timely topics. On Friday, September 22, we will host our Agricultural Business and Tax Planning Seminar. This session will address in-depth entity planning issues and key mistakes made by farm estate planners. Each day will offer an hour of ethics credit. For more information or to register, click here.
We're also preparing for our 44th Annual Federal Income Tax Schools. Dates and locations for 2017 are as follows:
November 2-3, 2017 – Maquoketa, Iowa – Centerstone Inn and Suites
November 6-7, 2017 – Le Mars, Iowa – Le Mars Convention Center
November 8-9, 2017 – Atlantic, Iowa – Cass County Community Center
November 9-10, 2017 – Mason City, Iowa – North Iowa Area Community College
November 16-17, 2017 – Ottumwa, Iowa – Indian Hills Community College
November 20-21, 2017 – Waterloo, Iowa – Hawkeye Community College
December 11-12, 2017 – Ames, Iowa and Live Webinar – Quality Inn and Suites
For more information, click here.
The jury returned a big verdict against Syngenta on June 23 in the first trial of the massive Syngenta GMO litigation. This case was presented on behalf of a class of more than 7,000 Kansas corn producers, specifically those Kansas producers who priced corn for sale after November 18, 2013, and who did not purchase Viptera or Duracade corn seed. Any Kansas producers who met that definition and did not affirmatively opt out of the class were automatically part of this action.
After a relatively short deliberation, the jury determined that Syngenta was negligent in the timing, scope, and manner in which it commercialized its Viptera and Duracade GMO corn, specifically by selling it before receiving import approval from China. The jury determined that China's rejection of the corn was not a superseding cause of the plaintiffs' damages. The jury assessed $217.7 million in compensatory damages against Syngenta, which was the amount the Kansas class requested. The jury chose not to award punitive damages, finding that Syngenta did not act in a "wanton" manner (with reckless disregard to the probable consequences) toward the producers.
Continue reading here.
The decision to lease farm ground comes with many choices: cash rent, crop share, or some combination thereof. Parties to a lease must understand that each option has distinct income tax implications. We've prepared a fact sheet to provide a brief overview of several key tax considerations associated with farmland leases, as they apply to individual landowners. We will post a more comprehensive review of this topic in the next couple of months.
Under a cash rent lease, the farm tenant generally pays a cash sum (usually on a per acre basis) to the landlord for the privilege of renting the farm ground. Rent received by a landlord under a typical cash rent lease is rental income, not subject to self-employment tax. This means also that the income will not be credited as net earnings from self-employment for social security eligibility purposes. Individual cash rent landlords report their rental income on Schedule E, IRS Form 1040.
Continue reading here.
On June 22, 2017, Senate Republican leaders unveiled a “discussion draft” of their bill to replace many provisions of the Affordable Care Act (ACA). As with the American Health Care Act of 2017 that passed the House on May 4, 2017, the Better Care Reconciliation Act of 2017 (BCRA) is designed to stay within the constraints of the budget reconciliation process. As such, the bill could pass with the approval of only 50 Republican Senators (the Vice President could cast the tie-breaking vote). It also means that the BCRA cannot include provisions that do not change the level of spending, revenues, or the debt limit. In other words, the provisions have to be budget related, and they cannot increase the deficit for any period beyond the budget reconciliation period (usually 10 years). These restrictions greatly limit the extent to which the bill can actually “repeal and replace” the ACA.
Nonetheless, the BCRA would significantly change much of the ACA. Although it is quite similar to the House Bill, there are differences, perhaps most notably those provisions related to premium tax credits. If the BCRA were to pass the Senate, those differences would be worked out in committee. The CBO and the Joint Committee on Taxation released their scoring of the legislation on June 26. It appears that any vote on this bill will not come before the Senate until after the July 4 recess. More amendments may be issued Friday.
Continue reading about the tax provisions in this bill here.
As you know, our work at the Center is dependent on the fees generated by seminar registrations and gifts. If you would like to donate to further the Center's efforts, please contact our Program Administrator, Tiffany Kayser at email@example.com or (515) 294-5217. You can also give online with a credit card. We thank you for your generous support.
We are very excited for our upcoming Comprehensive S Corporation Taxation Course, July 20- 21, 2017, at the Courtyard by Marriott in Ankeny, Iowa. The course will be taught by Bob Jamison, CPA, PhD, a foremost expert and author in the field. Participants will receive a 350-page workbook and an opportunity to ask substantive questions. We hope you’ll join us live or via webinar for this exciting new offering! For more information or to register, click here. Registration price increases after July 5.
On June 1, 2017, the United States District Court for the District of Columbia entered summary judgment in a class action seeking to end IRS’s use of the mandatory preparer tax identification number (PTIN). Although the court ruled that the IRS does have authority to require the use of PTINs, it found that IRS does not have authority to charge fees for issuing those PTINs. Continue reading here.
IRS has recently made it easier and much less costly to file a late Form 706 to elect portability. Effective June 9, 2017, Rev. Proc. 2017-34, creates a simplified method for making a late portability election, as long as the estate was only required to file Form 706 for the purpose of electing portability. Continue reading here.
June was a busy month on TaxPlace. Check out these offerings:
June 21, 2017 The Scoop - June 21, 2017
June 20, 2017 Webinar Replay - My Client Dies, What's Next?
June 16, 2017 Applicable Federal Rates (AFRs): July 2017
June 13, 2017 Webinar Replay - Form 4797 - Sale of a Business Asset
June 7, 2017 The Scoop - June 7, 2017
June 2, 2017 Don't Trust Those IRS FAQs
Don't forget to check out our many upcoming live webinars. One new offering Farm Assets and Basis after the Death of the Farmer will be taught by Kurt Konek, CPA.
CALT does not provide legal advice. Any information provided on this website is not intended to be a substitute for legal services from a competent professional. CALT's work is supported by fee-based seminars and generous private gifts. Any opinions, findings, conclusions or recommendations expressed in the material contained on this website do not necessarily reflect the views of Iowa State University.